opportunity, page-28

JEK,

I totally agree with you - must hold on, but I go further and say that this is a good buying opportunity.

AGO is down 20% in a couple of weeks and this after the doubling of respurce and signing of offtake agreements for 30% of current years expansion.

The market mood must and will turn, as I do not see that the issues raised as drivers of this correction are really that scary.

1. China tightening is really a non issue. China is a command economy and they are extremely good at opening / closing the floodgates in order to keep growth at between 8-9% which is where they see it should be to balance employment with population growth.

2. Bank regulation - This must and will be done, but I do not see it as a bad thing. Yes some investment banking operations will be effected but the benefit is that maybe we can finally have a more correct allocation of funds to real projects that will drive future growth, rather than funds being withheld for speculation. The fact that there are profitable investment projects that cannot be funded is a market failure that needs to be corrected.

3. Greek default - Even if it does happen (which I do not think so) how important is the small Greek economy to world growth and commodity markets?

4. Risk of a double dip recession - On what basis is this really possible. Asia is clearly growing and the bigger problem is to keep inflation in check, the US has rebounded on inventory building and although it will be slow there will be growth going forward and even Europe as a whole is looking more positive.

So really the only real negative is that global unemployment is at very high / record levels and business will be looking to first get more productivity gains from current workforce before hiring new staff. This will however reach a breaking point with union intervention and we should then see jobs growith coming through.

Ok, only my feeling, but I think this sell off is way overdone and should have been restricted to shares whose future earnings can not possibly keep up with current market cap and AGO is not one of those.

BR
Max